HSBC, Europe’s largest bank, on Tuesday announced up to $1 billion in share buybacks and reported third-quarter pre-tax profit that broadly met analysts’ expectations.
HSBC’s revenue rose to $18.6 billion from $17.8 billion in the same period last year, with net interest income in the banking division rising 6%, along with a corresponding increase in fee income from its institutional banking and wealth businesses.
Below is a comparison of HSBC’s third quarter results to the bank’s consensus forecasts.
Pre-tax profit: $9.63 billion vs. $9.69 billion expected Revenue: $18.6 billion vs. $18.93 billion expected
The bank’s pre-tax profit for the third quarter rose 32% from a year ago to $9.6 billion, which also reflected the absence of $1.4 billion in legal provisions recorded in the same period last year. Higher sales and lower credit losses also supported earnings.
Shares of HSBC, which approved a third interim split of 10 cents per share, fell 2.95% in Hong Kong following the release of its third quarter results.
The bank’s net interest income rose to $9.3 billion in the third quarter, supported by deposit growth and reinvestment of “high-yield structural hedges.”
Meanwhile, operating expenses decreased 12% year over year to $8.8 billion. This is mainly due to the non-recurrence of legal provisions recorded in previous years. Excluding notable items, expenses increased due to inflation and increased spending on technology.
Looking ahead, HSBC maintained that it expects bank net interest income to be at least $46 billion in 2026, but reiterated its goal for return on average tangible equity, a measure of profitability, to be at least 17% from 2026 to 2028, excluding notable items.
The bank also expects its revenue to increase annually until 2028, with a target of 5% revenue growth in that year compared to 2027 on a constant currency basis, excluding notable items.
HSBC said it was on track to achieve operating expense growth of around 1% in 2026 on a targeted basis, although the strong performance could lead to additional performance-related pay and a slight increase in costs.
The bank announced $1 billion in share buybacks announced in its interim results and said it plans to complete another $1 billion in buybacks by its full-year 2026 results.
HSBC is reportedly considering significant job cuts at its UK wealth management business as part of a broader push to introduce artificial intelligence.
